Largest shareholders increase their stakes in China Gas
As China Gas talks to Sinopec about a stake sale, the two biggest holders of the city-gas distributor buy up more of the company
The two largest shareholders in the natural gas distributor China Gas Holdings have quietly raised their stake in the company, a week after China Gas said it has been in advanced talks to sell a stake to China Petroleum & Chemical (Sinopec) and form joint ventures with it.
The motive for the pair, China Gas's managing director, Liu Minghui, and Beijing Enterprises Group, in increasing their stake in China Gas, the mainland's largest city-gas distributor by number of project concessions won, has not been made public.
But the action would help the two reduce the dilution effect on their stakes of a potential shares sale to Sinopec.
Beijing Enterprises Group and China Gas Group, a joint venture between Liu and the London-listed company Fortune Oil, each bought 75 million China Gas shares at HK$6.74 each on February 28, according to filings with the Hong Kong stock exchange.
The price was 10 per cent cheaper than China Gas's closing price on the day of HK$7.55.
How the buyers amassed the shares was not disclosed, but they appeared to have bought them via a block trade from an investor owning less than a 5 per cent stake in China Gas. China Gas declined to comment.